A more thorough explanation:

Equity of redemption is a legal right that a borrower has when they default on a mortgage. It allows them to prevent foreclosure proceedings on their property by paying off the debt secured by the mortgage within a reasonable amount of time. This is also known as the right of redemption or equitable right of redemption.

The equity of redemption right only exists from the time of default to the commencement of foreclosure proceedings. The borrower must exercise this right within a certain amount of time, before an absolute foreclosure on the property. In some jurisdictions, the borrower also has a statutory right of redemption within six months following the foreclosure sale and becomes entitled to any surplus from the sale proceeds in excess of the outstanding mortgage.

Let's say John has a mortgage on his house, but he falls behind on his payments. The bank sends him a notice of default and starts foreclosure proceedings. However, John exercises his equity of redemption by paying off the debt secured by the mortgage within the given time frame. This stops the foreclosure and allows him to keep his house.

Another example is if Sarah's property is foreclosed on and sold at auction for $200,000, but the outstanding mortgage was only $150,000. Sarah may have a statutory right of redemption within six months to claim the $50,000 surplus from the sale proceeds.

These examples illustrate how the equity of redemption gives borrowers a chance to save their property from foreclosure and potentially receive any surplus from the sale proceeds.